Indian Pharma Machinery Makers Go For Overseas Tie-Ups For Growth

The pharmaceutical machinery manufacturing industry in the country, with more than 600 players of various sizes, is all set for a major boom with several domestic players prefer to either set up a joint venture company or enter technical collaboration with overseas firms.

According to industry sources, domestic pharma machine manufacturers are increasingly exploring technical collaborations and partnerships with overseas firms to innovate and share novel technologies. As several key players in the segment are looking towards advanced markets like the US and Europe, collaborations and joint ventures with the overseas firms are of great advantage to the domestic players.

The tie-ups with the overseas firms are expected to facilitate domestic companies to explore new geographical locations and access to the latest technological developments in the segment.

Some of the key players in the segment, which have either entered or plans to enter collaborations and joint ventures with the overseas firms are ACG world wide, Elmach Packages India Pvt. Ltd. and Parle Pharma Machineries.

Commenting on the joint ventures between domestic and international companies, Saurabh Upadhyay, executive director, Tax & Regulatory Services, Pricewaterhouse Coopers Pvt. Ltd., says, “joint ventures between domestic and global players are mainly to hare risks, avoid heavy government regulations, access to new market and capital and to get competitive edge.” He added, “Nature of the joint ventures are mainly technical, financial and technical –cum-financial collaboration. Selection of a partner is based on technical competencies, previous relationship, reputation and brand strength, financial standing, tenure of joint venture and management quality and capacity.”

The sources said that several global firms found it cost effective to work with Indian partners in the form of technical collaborations and joint ventures and thus can produce high quality machines at affordable process. The Mumbai based ACG World Wide, a leading player in the segment, has collaborated with VAW of Germany, Glatt of Germany and IWKA of Germany. Elmach Packages India Pvt. Ltd. has tied-up with German companies like Weipack and Merz. It is learnt that several other players are also expected to enter collaborations and joint ventures with the overseas firms in the future.

Commenting on the collaborations with the overseas firms, Piyush Tripadi, managing director of the Ahmedabad based Sree Bhagawati Pharma Machinery, says, “The joint ventures and collaborations with the international firms will provide the Indian companies access to new geographical locations and the latest know-how in the machine manufacturing segment.

(Ref: The Chronicle Pharmabiz dated November 15, 2007)